Renewed concerns over the global oil glut pushed oil prices into the red today in addition to new oil production data from Japan, Reuters reports.
Total oil production sales in Japan, the fourth largest global crude buyer, reached a 46-year low in November, Reuters noted.
Crude oil (WTI) is down by 3.67% to $36.70 per barrel, and Brent crude is down 3.56% to $36.54 per barrel, according to the CNBC.com index.
"A bearish stance still appears warranted and we continue to view a decline to the $32.50 area," Jim Ritterbusch of oil markets consultancy Ritterbusch & Associates told Reuters.
Data from the Organization of the Petroleum Exporting Countries suggests an oil oversupply of more than 2 million barrels per day, which equals more than 2% of global demand on the market.
Western Refining is an independent crude oil refiner and marketer of refined products based in El Paso, TX.
Separately, recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate WESTERN REFINING INC as a Buy with a ratings score of B. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its notable return on equity, attractive valuation levels, good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, WESTERN REFINING INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
- Net operating cash flow has significantly increased by 73.23% to $373.62 million when compared to the same quarter last year. In addition, WESTERN REFINING INC has also vastly surpassed the industry average cash flow growth rate of -26.85%.
- After a year of stock price fluctuations, the net result is that WNR's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- Regardless of the drop in revenue, the company managed to outperform against the industry average of 36.8%. Since the same quarter one year prior, revenues fell by 36.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- You can view the full analysis from the report here: WNR